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29/04/2014

£1.5bn Scottish infrastructure investment to create thousands of jobs

Words: Roger Milne
Deputy first minister with construction workers

An innovative financial model is helping to unlock £1.5 billion of public and private investment in infrastructure in Scotland, deputy first minister Nicola Sturgeon has confirmed.

The Tax Incremental Financing (TIF) scheme allows councils to fund infrastructure by borrowing against future business rate income that should be generated by the resulting regeneration and development.
 
The highest profile of six scheduled TIF pilot projects is Glasgow’s £80 million Buchanan Quarter project to develop the city centre, already under construction, which will bring in £310 million in private investment and is estimated will create up to 1,500 jobs.
 
Other projects targeted under the TIF scheme include Falkirk’s £67m of improvements, to include better M9 motorway links and flood defences. This, it is claimed, will unlock £413m in private funding and create almost 6,000 jobs.
 
Argyll and Bute’s £18.9m scheme to extend Oban North Pier from September also falls under the aegis of TIF, as does North Lanarkshire’s Ravenscraig Phase 2 project.
 
Overall, the scheduled projects are expected to attract in the region of £1.5 billion of public and private sector funding. Use of TIF in the projects has been brokered by the Scottish Futures Trust (SFT), set up by the Scottish government to deliver “value for money” in public infrastructure works.
 
Visiting the Buchanan Quarter project to view progress, Sturgeon said: “The Scottish Government will use every lever at its disposal, such as TIF, within its devolved powers, to help boost the Scottish economy.
“Scotland needs independence so the Scottish Parliament can have full control over taxation, borrowing and spending to determine investment priorities according to the needs of the Scottish economy and public services, to promote growth, employment and opportunities for all to flourish.”
 
SFT’s chief executive Barry White said: “It’s a great demonstration of how the public and private sector can work together in a new way in order to create jobs and to support economic growth.”

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